Regulatory Changes in Federal Contracting:
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1. Simplified Acquisition Threshold (SAT) Raised
Main change:
The SAT increased from $250,000 to $350,000. The micro-purchase threshold increased from $10,000 to $15,000.
Layman’s breakdown:
Federal buyers can now purchase more goods and services using simplified purchasing procedures. This usually means faster buying, less red tape, and potentially easier entry points for small businesses.
Why it matters:
More opportunities may fall into quicker procurement categories where competition and paperwork are lighter.
Source Links:
https://www.acquisition.gov/threshold-changes
2. CMMC 2.0 Implementation for DoD Contracts
Main change:
The Department of Defense officially began rolling out CMMC 2.0 requirements into defense solicitations and contracts.
Layman’s breakdown:
If you work on DoD contracts involving sensitive information, cybersecurity compliance is no longer optional. Certain contracts now require a verified cybersecurity certification level before award.
Why it matters:
Defense contractors and subcontractors that ignore CMMC may become ineligible for future work.
Source Links:
https://business.defense.gov/Programs/Cyber-Security-Resources/CMMC-20/
https://dodcio.defense.gov/CMMC/
3. FAR Overhaul Initiative
Main change:
The FAR Council launched a major rewrite effort often referred to as the “Revolutionary FAR Overhaul.”
Layman’s breakdown:
The government is attempting to simplify and modernize the federal acquisition rulebook.
Why it matters:
Contractors may start seeing new solicitation language, clause structures, and buying procedures across agencies.
Source Links:
https://www.acquisition.gov/far-overhaul
https://www.acquisition.gov/far-overhaul/far-part-deviation-guide
4. Agency-Level FAR Class Deviations
Main change:
Federal agencies have been issuing class deviations tied to FAR modernization and policy updates.
Layman’s breakdown:
Agencies can temporarily change how they apply FAR rules before official FAR updates become government-wide.
Why it matters:
Two solicitations from different agencies may now operate under slightly different rules even if they look similar.
Major Agencies Issuing Deviations:
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DoD
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VA
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GSA
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DOE
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DHS
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NASA
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HHS
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USDA
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Treasury
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DOJ
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State Department
Source Links:
https://www.acquisition.gov/far-overhaul/far-part-deviation-guide
https://www.acq.osd.mil/dpap/dars/class_deviations.html
5. SAM.gov Pre-Award Registration Clarification
Main change:
The FAR clarified that contractors must be properly registered in SAM.gov before award.
Layman’s breakdown:
An incomplete or inactive SAM registration can delay or block contract awards.
Why it matters:
Many contractors assume SAM only matters at submission. Agencies are paying closer attention to registration compliance before award.
Source Links:
https://www.acquisition.gov/content/publication-fac-2025-05
6. Inflation-Based FAR Threshold Increases
Main change:
Multiple FAR thresholds increased due to inflation adjustments.
Layman’s breakdown:
The government raised many dollar limits that trigger compliance requirements and procurement procedures.
Examples:
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Simplified procedures threshold increased
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Subcontracting plan thresholds increased
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Cost/pricing data thresholds increased
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Commercial item thresholds increased
Why it matters:
Some contracts now require fewer compliance obligations at lower dollar amounts.
Source Links:
https://www.acquisition.gov/threshold-changes
7. Increased SBA Oversight of 8(a) Firms
Main change:
SBA increased scrutiny and enforcement actions involving 8(a) program participants.
Layman’s breakdown:
The government is auditing and reviewing whether 8(a) firms are truly eligible and compliant.
Why it matters:
Companies in the 8(a) program should expect more documentation requests and oversight activity.
8. SBA Size Standard Reviews
Main change:
SBA proposed updates to several industry size standards.
Layman’s breakdown:
The definition of “small business” may change depending on your NAICS code.
Why it matters:
Some companies could become newly eligible for small business contracts, while others may outgrow eligibility.
Source Links:
https://www.sba.gov/article/2025/08/28/sba-proposes-revisions-monetary-based-industry-size-standards
https://www.ecfr.gov/current/title-13/chapter-I/part-121
9. Increased Domestic Preference / Buy American Enforcement
Main change:
Federal agencies continued implementing stricter Buy American sourcing requirements.
Layman’s breakdown:
The government is pushing contractors to use more American-made products and materials.
Why it matters:
Contractors supplying foreign-made items may face tighter restrictions or pricing disadvantages.
Source Links:
https://www.acquisition.gov/buyamerican
https://www.whitehouse.gov/omb/management/made-in-america/
10. AI Use in Federal Procurement Is Increasing
Main change:
Federal agencies are rapidly expanding AI guidance, evaluation tools, and procurement initiatives.
Layman’s breakdown:
Government buyers and contractors are increasingly using AI for market research, acquisition planning, proposal drafting, and compliance review.
Why it matters:
Contractors that learn to leverage AI responsibly may gain efficiency advantages over competitors.
Source Links:
https://www.ai.gov
https://www.gsa.gov/technology/government-it-initiatives/artificial-intelligence
Disclaimer
DISLCAIMER: Derek's primary product is Proposal Writing and Proposal Reviews. He offers these through his courses and coaching services.
Derek is not a lawyer and does not have a professional designation to interpret the law or federal regulations. He shares his experience working in the industry and you operate at your own risk. In no way does Derek propose the "set it and forget it" reckless middle manning that is mentioned in the space. In speaking to these regulations, Derek aims to increase awareness around them, and to increase the number of small govcons who abide by them.
It's incredibly important to remain in control of the key and vital tasks of any contract you win as the prime. You must stay involved and in control at all times when managing teaming partners, and you should share in as much of the work as you possibly can, this way you can learn and grow your own business as much as possible. This is not a hands-off or passive industry. It's a lot of hard work, but can be very rewarding as well.Â